Correlation Between Kingdee International and MARKET VECTR
Can any of the company-specific risk be diversified away by investing in both Kingdee International and MARKET VECTR at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Kingdee International and MARKET VECTR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingdee International Software and MARKET VECTR RETAIL, you can compare the effects of market volatilities on Kingdee International and MARKET VECTR and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Kingdee International with a short position of MARKET VECTR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingdee International and MARKET VECTR.
Diversification Opportunities for Kingdee International and MARKET VECTR
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kingdee and MARKET is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Kingdee International Software and MARKET VECTR RETAIL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MARKET VECTR RETAIL and Kingdee International is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Kingdee International Software are associated (or correlated) with MARKET VECTR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MARKET VECTR RETAIL has no effect on the direction of Kingdee International i.e., Kingdee International and MARKET VECTR go up and down completely randomly.
Pair Corralation between Kingdee International and MARKET VECTR
Assuming the 90 days trading horizon Kingdee International Software is expected to generate 5.78 times more return on investment than MARKET VECTR. However, Kingdee International is 5.78 times more volatile than MARKET VECTR RETAIL. It trades about 0.14 of its potential returns per unit of risk. MARKET VECTR RETAIL is currently generating about 0.25 per unit of risk. If you would invest 70.00 in Kingdee International Software on November 2, 2024 and sell it today you would earn a total of 55.00 from holding Kingdee International Software or generate 78.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.09% |
| Values | Daily Returns |
Kingdee International Software vs. MARKET VECTR RETAIL
Performance |
| Timeline |
| Kingdee International |
| MARKET VECTR RETAIL |
Kingdee International and MARKET VECTR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingdee International and MARKET VECTR
The main advantage of trading using opposite Kingdee International and MARKET VECTR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingdee International position performs unexpectedly, MARKET VECTR can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in MARKET VECTR will offset losses from the drop in MARKET VECTR's long position.| Kingdee International vs. FIREWEED METALS P | Kingdee International vs. MAGNUM MINING EXP | Kingdee International vs. GREENX METALS LTD | Kingdee International vs. ARISTOCRAT LEISURE |
| MARKET VECTR vs. EIDESVIK OFFSHORE NK | MARKET VECTR vs. Luckin Coffee | MARKET VECTR vs. JAPAN TOBACCO UNSPADR12 | MARKET VECTR vs. Solstad Offshore ASA |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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